![]() Daily living activities include eating, toileting, transferring, bathing, dressing, and continence (section 7702B(c)(2)(B) of the Code). An individual is chronically ill if the individual meets one of two "triggers." The first trigger is the inability to perform at least two daily living activities without substantial assistance from another individual for at least 90 days. Qualified long-term care services are certain services that a chronically ill individual requires, and that a licensed health care practitioner prescribes under a plan of care (section 7702B(c)(1) of the Code). For purposes of this deduction, medical care expenses include amounts paid for the treatment or mitigation of a mental illness and amounts paid for qualified long-term care services (section 213(d)(1) of the Code). However, an exception allows taxpayers to deduct expenses that they pay for medical care of the taxpayer, the taxpayer's spouse, or the taxpayer's dependent, subject to certain limitations, if the expenses are not covered by insurance (section 213(a) of the Code). * * * asked about the deductibility of expenses paid to care for her mother, who is in an assisted care program because she suffers from Alzheimer's disease.Īs a general rule, taxpayers may not deduct personal, family, or living expenses (section 262(a) of the Internal Revenue Code (the Code)). To start your assisted living search, visit letter responds to your inquiry dated December 10, 2008, on behalf of your constituent, * * *. ![]() They’ll help you work out the details on what expenses can be properly deducted and how to do so. Keep all documentation related to your medical and assisted living expenses throughout the year and bring them to a qualified accountant come tax time. It’s better to pay a professional to get it right than risk the penalties or back pay that could come with making a mistake. Talk to Your AccountantĮven if this post provided you a little more understanding of how taking deductions for assisted living works, you’re unlikely to figure out how to do so properly without the help of a trained accountant. If several siblings work together to provide support for an aging parent, they can still each take the amount spent in deductions if the amount of support they provided together exceeds 50% of the parent’s support. That doesn’t just mean their medical expenses, it includes food, utilities, and all general living expenses. It also means that you must have been responsible for over 50% of their support in the last year. That means their income can’t exceed the amount allowed by law for dependent status (a number that changes often – it was $4,000 in 2015). If you’re a caregiver paying for a senior’s care, you may still be able to deduct some of the expenses for tax purposes, but the rules are a little different.įirst, your loved one has to be legally considered a dependent. For anyone born after that date, the deduction floor is raised to 10%. That means if what you spend on medical care exceeds 7.5% of your income, you can deduct all expenses that go beyond that. Not everyone can deduct medical expenses, it depends on what your overall income is and how much of your income is going toward medical expenses.įor seniors born before January 2, 1950, the deduction floor is 7.5%. The only way the government will see the whole stay as medical care though is if a doctor has recommended assisted living as part of a certified care plan for the patient. In some cases, if a senior is in an assisted living facility for reasons directly related to an illness or injury, the entire cost may become deductible. The assisted living facility should provide you with documentation that shows which of your costs are attributed to medical care. Usually what you pay for your room in the facility and your meals won’t be deductible, but any medical care you receive through the facility will be. Not all assisted living expenses qualify as medical expenses though, so the trick is to figure out which portions of your assisted living bill fall into that category. The main rule that affects assisted living tax deductions is that, in many cases, you’re allowed to deduct medical care expenses. Deductible Expenses Must Qualify as Medical Care Here are the main factors that make a difference. You can’t always deduct all assisted living expenses, but in a lot of cases you can deduct at least some. When you’re in the position of figuring out how to pay for an assisted living facility for yourself or a loved one, every little bit counts.Īnd you may be able to get a little bit of a break come tax time. Families that know a loved one needs assisted living care typically struggle to make the numbers work.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |